Question

The following transactions occurred between Southwick Company and Mann Stores, Inc., during March:

Required

Prepare the necessary journal entries for (a) the books of Southwick Company and (b) the books of Mann Stores, Inc. Assume that both companies use the periodic inventory system.

Mar.

8

Southwick sold $7,100 worth of merchandise to Mann Stores, terms 2/10, n/30.

 

10

Mann Stores paid freight charges on the shipment from Southwick Company, $200.

 

12

Mann Stores returned $700 of the merchandise shipped on March 8.

 

17

Southwick received full payment for the net amount due from the March 8 sale.

 

20

Mann Stores returned goods that had been billed originally at $400. Southwick issued a check for $392.

a. SOUTHwICK COMPANY GENERAL JOURNAL Date Description Debit Credit Mar. 8 Sold goods to Mann Stores terms 2/10, n/30 12 Issued credit memo to Mann Stores for returned goods. 17 Cash Received payment in full from Mann Stores. 20 Cash Issued check to Mann Stores for returned goods.